Advertised pay drops as firms seek retention

Chris Papadopoullos was City A.M.'s economics reporter until February 2016.

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Chris Papadopoullos

UK FIRMS are beginning to focus more on retaining staff than taking on new recruits, according to figures from job search website Adzuna.

Advertised salaries fell to £33,873, in July, down 1.1 per cent compared with the same month last year, the company said today.

The drop in salaries to a one-year low is evidence that firms are shifting from recruitment to retention, Adzuna said.

“Companies are clinging on to the skilled workers they already have, rather than bringing in new talent at the top,” said Andrew Hunter, the company’s co-founder. “They are rewarding those loyal employees that stood by their side during the recession, but who hadn’t seen salaries rise since these lean years.

“Now, these employees are receiving their recession rewards, as workloads sprawl and middle managers become ever more important.”

The trend was particularly noticeable in London, with a 2.8 per cent drop in advertised pay to £40,396.

“The previously high salaries commanded by London consultants only work in an environment of scarcity. Now they’re being pared back, and advertised salaries in the capital are paying the price,” Hunter said.

By sector, the biggest fall in salaries was in energy, oil and gas which fell by an average 12.7 per cent. That was followed by healthcare and nursing, where advertised pay was 6.5 per cent lower.

Despite the shift to retention, the number of advertised vacancies climbed 3.3 per cent in July compared with June.

Competition for jobs is now at a new record low of 0.64 job seekers for each position. The figure compares with 1.14 job seekers per vacancy last year.

The reduced competition for work comes amid a small rise in UK unemployment. Hunter said this was evidence of a skills mismatch, with employers looking for workers with different skill sets from those who are seeking jobs.